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4. Suppose that there are two changes happening simultaneously in the Stockton housing market: home prices are rising, while at the same time more houses

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4. Suppose that there are two changes happening simultaneously in the Stockton housing market: home prices are rising, while at the same time more houses are being sold. Your friend who took an Economics class years ago is arguing that this violates the law of demand, which states that price and quantity should be negatively (inversely) related. What important aspect of the law of demand is being overlooked? How would you explain to your friend the fact that price and quantity may increase with the law of demand still holding? Use a graph to explain your

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